Everyone feels as though he or she is paying too much in taxes each year. It is true of individuals as well as large and small businesses. While everyone has an obligation to pay their taxes, that does not mean they should pay more than they actually need to pay. Let’s look at some tried and true tax tips that will help your company save some money.
Shift Income to the Following Year
You have to pay taxes on any income that you receive during the year. As the end of the year approaches, you may want to push some customer and client bills into the following year, giving them a larger grace period and ensuring that you will have to pay tax on less than you would have if that income had come into your company.
Charitable Contributions
Businesses and individuals alike can gain some tax advantages when they donate to charity. Donations can reduce your taxable income, so making regular contributions to charity throughout the year can really help when it comes to tax time. Another benefit of donating to charity that has nothing to do with taxes is simply the warm feeling that you are doing something nice for others. The fact that you also get a tax deduction out of it is simply icing on the cake.
Invest in Equipment
If you are in need of new equipment (i.e. computers. photocopies, office furniture, vans etc) then you can buy these before the end of the year so that you benefit from their depreciation which will lower your taxable income and thus your tax position.
Keep Track of Expenses
Keep good organization regarding all of your business expenses throughout the year, so you can then deduct them at the end of the year. Small businesses do not always deduct as much as they actually could simply because the business owner forgets or neglects to record every single possible business expense. Always make sure to keep business and personal expenses separate as well.
Work With Professional Tax Advisors
While you can find quite a few tips to help you save on your taxes, you have to remember that taxes, for individuals and businesses, are complicated affairs. The tax laws tend to change slightly each year, and staying on top of those changes is important to make sure you are complying with the law and still finding as many tax advantages as possible. One of the best ways to make sure you are on the right track is to work with a professional tax adviser.
